“It’s what you learn after you know it all that counts.”

— attributed to former President Harry S Truman.

I get a lot of unsolicited advice, to which I listen carefully because it gives me clues about things that might really matter. Here’s a recent example.

I called on the CEO of a major enterprise, a man of no scarcity of opinions. He is a scourge of business schools—and yet I respect him and count him as a friend of over a decade. It had been a while since we talked, so I should have guessed that he had bottled up quite a rant about management education, which, when uncorked, went something like this:

New MBAs can’t do anything valuable like start or run a company, invent the new iPad or search engine, or reorganize a dying business to make it successful. They are focused too much on frameworks, theories, and abstractions about how the world works. They just re-hash ideas from anthropology, economics, psychology, and sociology. Why can’t they just focus on business directly? B-schools aren’t doing their job.

So, this is a case study and here’s your assignment: stop reading and reflect for a couple of minutes on a question: Where is the “noise” in this rant and what is the signal—that is, what might be a clue here to something that really matters?

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I’ll guess that you’ve read or heard some of the same things—often from a talk-show pundit or embittered investor looking to incriminate the scoundrels who caused the Global Financial Crisis. The CEO’s sweeping indictment glosses over some huge variations within the b-school field, a problem that I’ve written about before (for instance, see this and this). A great university education teaches one to beware of generalization from a heterogeneous sample and of stereotyping, especially based on few observations. For instance, at Darden we don’t just teach theories and frameworks; we also emphasize their application and usefulness. I don’t want to turn this posting into a reflection about statistical inference, so I’ll move on…but if you want to change anything (especially b-schools) it is vital to be well-grounded in facts. In my view, this is the “noise” part.

The signal I detect regards a gap in expectations about what the world expects of newly-minted MBA’s. Are they supposed to do the heaviest kind of lifting from day one? If so, are b-schools producing such graduates? If not, what kind of lifting should the world expect? I think that MBAs should be prepared to have impact quickly after graduation. The CEO seems to set a very high expectation about the extent and kind of impact.

Humans are always in some stage of becoming. Our reach (or aspiration) always exceeds our grasp, especially in education. There is always more to be learned. It is unrealistic to expect that MBA graduates will spring full-blown into professional life ready to perform the most difficult tasks, like an Eric Schmidt, Bill Gates, Steve Jobs, or Jeffrey Immelt. We need learners, not know-it-alls; we need people who ask questions very well more than we need people who answer questions precisely. It is quite possible that the Foundation CEO had in mind some image of an MBA education frozen in time. Yet the reality is that the target field of mastery keeps changing, in response to changes in the business world. We need people who can learn and adapt very well in response to a changing field.

Running a company, inventing new products, and reorganizing a dying business require talents that one ordinarily grows into. To remove a brain tumor, we all want the neurosurgeon who has done thousands of similar operations; we want airline pilots who have flown in all kinds of weather; we want meals from the restaurant with an ‘A” rating from the health department. The common theme among these is high reliability. Organizations that produce high reliability have employees who show consistent attributes, such as critical thinking, high mindfulness, and careful diligence. You learn these kinds of attributes. And by learning you grow in wisdom. Walter Wriston, the iconic former CEO of Citigroup said, “Good judgment comes from experience; experience comes from bad judgment.” My response to my friend, the CEO, was to ask, “when did you start to demonstrate these abilities?” His reply after a lengthy pause was “about 10, 15, or 20 years after college. “

This challenges the notion of what it means to “complete” one’s preparation in business. Are you ever really done or fully completed? In 1653, Izaak Walton published The Compleat Angler, a book about fishing. His spelling of the adverb, “compleat,” is the archaic version of “complete” but has acquired a broader meaning than “to have all the necessary parts.” The Free Dictionary defines “compleat” as “characterized by a highly developed or wide-ranging skill or proficiency…Being an outstanding example of a kind; quintessential.” To be “complete” says you have the necessary and sufficient business training; in contrast, to be “compleat” says you are a hot shot. I think the CEO is using the “compleat” business person as the standard for judging the impact of new MBAs. My point is that to be “complete” in preparing for business, you should get an MBA. But to become a “compleat” person of high impact requires both education and experience.

The other aspect of the CEO’s signal has to do with the content of an education. His rant echoes a very American orientation toward useful knowledge. American MBA students are prone to ask “So, what can I really do with this new concept you’ve just taught me?” It’s a great question. But teaching a student some skills (know how) in the absence of context (know what) or character (know why) is dangerous. To a child with a hammer, everything looks like a nail. We know that a narrow focus on profits and financial engineering brought ruin to Enron and Lehman Brothers. After the Global Financial Crisis, I have met no one who thinks that simply teaching the tools of business is sufficient anymore. We need socially aware MBA graduates, who understand the wider context and impact of their actions. Also, Aristotle said that character is destiny. Shall not b-schools aim to develop graduates with attributes such as integrity, determination, and social awareness?

Increasingly the “know what” stuff is migrating from textbooks to the digital medium. You can download tutorials to teach you bookkeeping, discounted cash flow, and the IS/LM model in macroeconomics. But once you have memorized all those tools, are you any wiser or more capable? The business profession needs people who can use that objective knowledge in creative and critical ways: What are the limitations of those models? Are the assumptions valid? Have we thought of all possible alternatives? Given that we have imperfect information and that the future is uncertain, what shall we do?

Signal versus noise. Complete versus compleat. Abstractions versus useful knowledge. These distinctions are important for all observers of b-schools. And the CEO’s rant echoes in my mind for one additional reason. The meme about Darden—the word on the street and the idea in our promotional material—is that Darden prepares you to be “Ready for Anything.” The rant challenges all b-schools to consider what we mean by professional readiness. How much do schools actually care about readiness? I don’t think the CEO knows; but he surely has views. I am confident that Darden well prepares graduates for all the kinds of challenges they will face upon graduation—and more importantly, for dealing with a world that is changing at an accelerating pace. At Darden, we think that an MBA program should build a blend of knowledge (“know what”), skills (“know how”) and attributes of character (“know why”). The feedback from our stakeholders—both the rants and raves—is always valuable because it helps us continuously to improve our programs. The CEO is right that MBA graduates need to deliver clear skills to the world of practice. But skills alone are not sufficient. The capabilities that we most value grow with experience.